Property taxes fund essential services such as education, road maintenance, waste collection, snow removal and emergency services like police, fire departments, and ambulances.
Each province and municipality allocates these funds differently, making it important for homeowners to understand where their money goes. Failing to pay can lead to interest charges, liens, or even legal action.
When buying a home, factoring in property taxes is crucial to ensure long-term affordability.
What Happens If You Don’t Pay?
Failing to pay property taxes can have serious consequences. While the government rarely seizes and sells a home over unpaid taxes (a process that can take years), penalties still apply.Unpaid taxes typically accrue interest, and if left unresolved, the municipality may initiate collection efforts or place a lien on the property. In some cases, a Tax Arrears Certificate may be registered against your home, signaling ongoing delinquency.
Budgeting for Property Taxes
When buying a home, many buyers focus on the sale price, mortgage payments, and utility costs but often overlook property taxes. The exact amount varies based on location and property value, making it essential to research local tax rates before purchasing. Most real estate listings include details on past property taxes, offering insight into what to expect.Including property taxes in your budget ensures you’re financially prepared for the full cost of homeownership and helps you avoid future financial strain.